What is bank reconciliation and how do I use it?

2

Comments

  • mommyof4grlzmommyof4grlz Member Posts: 21

    My Balance End Date is in the middle of the month. I see no way to change this. Am I missing something or will this be addressed in the very anticipated update?

    EDIT
    I found that I can change the date in a newly updated article. Here's to hoping!

    edited March 28, 2019
  • ZoeCZoeC Member Posts: 388 admin

    Hey @mommyof4grlz, thanks for letting us know your figured things out! :smile:

  • JHRED1JHRED1 Member Posts: 17

    It's a new system which needs to be learnt so definitely headache time. I do think the previous system was more straightforward. Time will tell.

    edited April 9, 2019
  • JHRED1JHRED1 Member Posts: 17

    .

    edited April 4, 2019
  • JHRED1JHRED1 Member Posts: 17

    Reconciling just got more complicated but I am starting to get used to it.

    Splitting a transaction was easy as well but now it's more complicated. Splitting a single payment for several invoices can't be split and merged with each invoice any longer. Instead I have to duplicate the entries and change the amounts and then merge the corresponding invoices - now I doubt my merged records are going to be kept complete anyway because it looks like some records have lost the corresponding merged record.

    I'm a business owner not a bookkeeper.. what I was doing on the transaction page was reconciling the bank (sync or statement uploads) against the payments made (invoices/receipts)...

    I've edited this because I am slowly getting to grips with the new system and I think once I have it nailed it'll be ok. It's definitely not as simple as before but I do think it's a lot more robust.

    edited April 9, 2019
  • JustinaEditJustinaEdit Member Posts: 6

    How can actual bank account be reconciled with wave, when wave records an invoice date and not the payment date when transactions are merged? The invoice maybe came in March but the payment was made in April, so two accounts will never match.

    edited April 7, 2019
  • JHRED1JHRED1 Member Posts: 17

    @JustinaEdit I'm with you on this one - why does the transaction default to the invoice date and not the payment date the money was paid from the bank? Surely the bank payment date should be the default? That said though this system will give a clearer picture of creditors since any unpaid invoice to a supplier is trade credit. This will have a bearing on end of year totals. Maybe something to do with Bills and Vendors.(?). To me this is the black magic of accounting and bookkeeping because I'm not an accountant or a bookkeeper.

  • JordanDJordanD Member Posts: 515 ✭✭✭

    @JustinaEdit @JHRED1 In cases where the payment was received in a different month, many users have used a money in transit account to hold the funds until they are actually received. In doing this, the Wave balance would match that in the bank account. When the payment is received, you can then create a transfer from the holding account into the bank account it was received to. This article should further explain the tasks needed to accomplish this: https://support.waveapps.com/hc/en-us/articles/360000389783-Recording-check-payments-in-transit

  • MikaCMikaC Member Posts: 2

    @Samd said:
    Hey @arillera, not yet but it should be released soon, and we will be notifying users via the Community when it is released. Thank you for your patience, and my apologies about the situation!

    I also have this problem as well. The balance end dates for my business Visa statements are mid-month, so I am not able to reconcile them with this system (you can only select dates within the month). I discovered that one week of transactions hadn't been transferred over so I wanted to check if that had happened in other months.

  • ZoeCZoeC Member Posts: 388 admin

    Hey @MikaCreative, thanks for reaching out and I am sorry to hear that you are still having some issues with your transactions. I'm not sure if your spotted Jordan's comment above, but I think it could be just what you are looking for,
    "In cases where the payment was received in a different month, many users have used a money in transit account to hold the funds until they are actually received. In doing this, the Wave balance would match that in the bank account. When the payment is received, you can then create a transfer from the holding account into the bank account it was received to. This article should further explain the tasks needed to accomplish this: https://support.waveapps.com/hc/en-us/articles/360000389783-Recording-check-payments-in-transit"

  • LJezardLJezard Member Posts: 3

    The reconciliation in Wave is dreadful. Someone with no knowledge of reconciliation must have programmed this. There is actually NO reconciliation going on, just a report screen and a stupid calculation of an entered amount for the bank ending balance and the difference with Wave's balance. That's it. Nothing more. In response to comments from users, one administrator insanely suggests creating "in transit" accounts. Do you realize this doubles the bookkeeping load? When will this be fixed? This is just not acceptable and I'm considering abandoning Wave due to this nonsense.

  • KevinLeahyKevinLeahy Member Posts: 3
    Hi Everyone,
    I could use some general help on reconciliation.
    I have two small businesses on Wave. I have a bank account for each and each is linked to the corresponding business account in Wave.
    However I often have receipts to upload to each business that were not paid from the account for that business. This is for many reasons:
    1. I paid cash.
    2. I paid from my personal account because there was not enough money in the relevant business account at the time.
    3. I purchased several things and some were for one business and some for the other.
    These receipts cause months to be Unreconciled in the Wave system.
    Am I using the system incorrectly in some way or is there a way to confirm to Wave that the receipts are okay even though they are not reflected in the business bank account?
    Many thanks in advance,
    Kevin
  • JordanDJordanD Member Posts: 515 ✭✭✭

    @LJezard Thanks for your frank feedback on our current Reconciliation tool in Wave. In full transparency, updates to the reconciliation tool are on our Roadmap for 2019 and we are actively working on a way that is more intuitive to our users, however, I appreciate you sharing that you are not finding the way it currently works neither efficient or intuitive. We appreciate you sounding off, we hear you, and we are working towards delivering on your feedback and the feedback of others in this thread.

    @KevinLeahy It sounds like what is preventing you from reconciling is uploading receipts that were for the business but not paid through a business account, or for another business. If this is the case, then you can categorize these transactions as "Owner's investment/drawing". This will show that capital that is from outside the business was used to make the purchase, and then the transaction will also not be included on the reconciliation totals. Give this a try and let me know if that helps to resolve some of the difficulties. :)

  • KevinLeahyKevinLeahy Member Posts: 3

    @JordanFromWave Thanks for your response Jordan. These receipts that I am uploading are expenses incurred in running my business. I use Owner's investment/drawing for money I draw out of the business as its owner - effectively that is my personal income. Is that not what it's for? I need the receipts to be recorded as expenses because that is what they are. When I run reports such as Sales/Expenses I need them to show up as expenses so that I can see my profit. I need to be able to signal to Wave that the expenses were incurred outside the bank account and so reconcile in a meaningful way. I hope that makes sense. I apologise if I am misunderstanding you or missing something.

  • JordanDJordanD Member Posts: 515 ✭✭✭

    @KevinLeahy Thanks for clarifying! You're correct in saying that the owner investment drawings should be used for money that you take out of the business. If you are paying yourself, no receipt would likely be necessary and when the transaction shows up on your statement, you can just categorize it to Owner's investment/drawing.

    When you assign Owner's investment drawing to an expense(i.e. a receipt), it typically means that this was an expense that happened in your business account, but was actually not related to the business. The owner investment drawings will allow the transaction to show up on your transactions page, so that you can still reconcile your accounts, but when it comes to the reports, it will be left out of it, because it was not an expense that relates to the business and therefore should not contribute to the business' profit or losses in the same way that a business expense would.

  • PkennPkenn Member Posts: 4
    Hi
    I've connected my visa account to Wave and entered the closing balance for each month in the Account Reconciliation page but I can't find the transactions for this account. Only seems to be one transaction on this account anyway (In the transactions section
  • BarsinBarsin Member, Moderator Posts: 2,041 ✭✭✭

    Hi there @Pkenn

    First off, RECONCILIATION (https://support.waveapps.com/hc/en-us/articles/208621636-What-is-bank-reconciliation-and-how-do-I-use-it-) is basically accounting for the transactions in your actual bank account, and making sure that they align properly in your wave account.

    Some things you may want to have handy in front of you before you get to reconciling your account is to have your bank account statements, either printed or online. Your monthly statements will show you an ending balance and all of your transactions in that monthly reconciliation period.

    So the best way to reconcile your account is to go to the first unreconciled month and make sure that the dates are correct and align with your bank account statements. Type in the ending balance here, and you will see that your account either reconciles perfectly, OR a discrepancy showing either a + or - value appears. The most ideal work method here is to open another tab in your browser to your transactions page, and filter the transactions by your monthly period. There you'll be able to find and account for by deleting or adding the transactional discrepancies and going back to your other browsing tab, refresh this page, and reconciling statement

    I will let you know our current method of reconciling your account takes you to the accounts transactions report, which we understand is not ideal. I've had the privilege of seeing the new account reconciliation tool which we've got coming down the pipeline and it looks great, it's user friendly, and will streamline your process. There is no ETA for us in the support of when this will be ready, but it's in the works, so stay tuned!

  • PkennPkenn Member Posts: 4
    Hi @Barsin
    Thanks for this
    Is there a reason my visa transactions aren’t showing up even though the account is attached? Other bank accounts do

    P
  • BarsinBarsin Member, Moderator Posts: 2,041 ✭✭✭

    Hey again @Pkenn

    Can you clarify what you mean by they don't show up? Are the transactions not populating in your transactions page anymore? We've got a great thread about bank connection issues and troubleshooting if you wanted to take a look

    https://community.waveapps.com/discussion/3882/how-do-i-troubleshoot-my-bank-connection/p1

  • ChelseaKChelseaK Member Posts: 261 ✭✭

    @Pkenn Hmm, if you have your credit card account connected to Wave and you don't see your credit card transactions, it sounds like this may be a bank connection issue where your transactions are not properly importing. For this, I would recommend checking out our Bank Connection thread which will give you tons of information on how to troubleshoot your connection: https://community.waveapps.com/categories/bank-connections

    If you're still having issues, reach out to us through a Support ticket and we can help you out there too: https://support.waveapps.com/hc/en-us/requests/new

  • mprydempryde Member Posts: 1

    I am struggling with reconciliation. My Bank account and Visa are both linked to Wave and everything that is on my bank statements show up under Wave Transactions. This is great, but when I go to reconcile the month, very few if any of these transactions are showing up in the reconciliation section and I cannot find information as to how to get these transactions to link up with the reconciliation process so my numbers balance out. Any tips? Thanks!

    edited June 14, 2019
  • PipPip Member Posts: 20

    I am stumped about how to record and reconcile cheques. Is this the workaround I need?
    1. When I write cheques, I should enter them manually into Wave, using an account I created called 'Cheques unpresented' and using category 'Accounts Payable'.
    2. When cheque is presented and therefore appears on my list of transactions (let's say 2 months after I wrote the cheque), I go into the 'Cheques Unpresented' account, and change it to 'Statement Account'
    .....
    No, that can't work, because now I've a duplication of the transaction. And that's not going to reconcile. Argh.

    Can someone please tell me step by step how I do this? thank you thank you

  • JamieDJamieD Administrator Posts: 1,156 admin

    @mpryde I would need to see exactly what you are doing when you are on the Reconciliation tab. If you notice that transactions have successfully imported into Wave via the Transactions page, and are not appearing on the Reconciliation tab after you've selected the correct account from the drop down, please let us know (potentially with a screenshot as well here).

    @Pip In this situation, I do feel as though it would be best to actually create a bill in Wave which can either be marked as paid, or associated with the expense transaction once the withdrawal happens from your bank account. Likewise, if you mark the bill as paid before the payment actually happens, when the payment DOES happen, you can simply just merge the two transactions together (you will want to make sure they are associated with the correct payment as well):

    https://support.waveapps.com/hc/en-us/articles/208622866-How-to-add-a-payment-to-a-bill

  • mayorcm281mayorcm281 Member Posts: 2

    The current setup for account reconciliation in Wave is USELESS!!

    I now have to click on Journal Entries in the list of transactions to locate specific entries that show on my bank statement. I have one JE for HST payments to CRA and the amount that it shows in the transaction screen is double the actual amount because of the entries in the JE.

    When will the simple method of checking off each entry be put back in the system. When I am reconciling a bank statement I should only see transactions that relate to that account, not all transactions included in the JE.

    I should not have to spend 3 times the amount of time doing my account reconciliations.

    Your Reconciliation screen is worthless as the balance on my bank statement will never match what is in WAVE as certain items have not cleared and made their way onto the bank statement. This feature is worthless. I should be able to specify the end balance for the month and then check off (reconcile) the transactions that have cleared and are shown on the statement and by hiding reconciled transactions I can easily see the ones that have yet to clear. To force me to go between 2 screens (Reconciliation and Transactions) is stupidity to the extreme. The only business model that this is good for is a cash system where the cash is either in the bank or not. Cheques written in one month take time to clear and sometimes do not show for months. There needs to be a simpler system for reconciling account.

    WAVE accounting is no longer simple to use, rather it is clumsy and complicated. WAVE used to be a great simple software, but not anymore.

    Will these issues be addressed?

    If not I will have to move to a different software package that actually works properly in terms of the way account reconciliation is supposed to work.

  • JamieDJamieD Administrator Posts: 1,156 admin

    @mayorcm281. Appreciate the feedback that you've given regarding the Reconciliation feature. One of the number one things we are looking to improve through this calendar year is that specific feature itself. We understand that it's redundant to have the Reconciliation page take you to the Account Transactions report (something that we recognize, needs improvement). We still don't have an official ETA as to when this will be available, but when we do, we will let our users know.

  • eric_greatfallseric_greatfalls Member Posts: 1

    Can only "owners" access the reconciliation feature? I have my accountant setup as an "administrator" and reconciliation isn't an option for him.....

  • JamieDJamieD Administrator Posts: 1,156 admin

    Interesting @eric_greatfalls. It's possible that your accountant is on the legacy version of the software, which could potentially prevent them from being able to access this feature, but they should definitely have access to this otherwise. Could you get your accountant to send a screenshot of what they are seeing and then post it in this thread? That would be super helpful!

  • BruceBBruceB Member Posts: 2

    Useless.
    The instructions bear little resemblance to what appears on my screen.
    For the Start button I assume you mean the Reconcile button. This takes me to a Report screen where the transactions for the relevant period are listed but there is nowhere to 'Enter the ending balance' as shown in the instructions.
    I liked Wave because it was simple - including the ability to enter the start and end dates and then tick off the transactions against the statement. You seem to be going down the path of making it more technically correct for accounting purposes - but burying it in the layers of accounting mumbo jumbo that simple users like me don't understand. Have to do the accounts myself and not big enough to justify an accountant.

    In this case the Reconciliation function is simply not present and does not work.

    The other joy you have lost is the ability to move transactions from personal to business and vv. I now have to categorise a business expense from a personal account as Owners investment/drawings - but there is no corresponding entry made in the business account. So I have to go there and create a separate Journal Entry.

    Why have you not kept the linkage between the personal and business accounts when they are both the same amount?

    You are heading from simple accounting to a make work programme.

  • JamieDJamieD Administrator Posts: 1,156 admin

    Hey @BruceB. I can definitely appreciate what you're saying here in terms of Reconciliation in Wave, which is why in the upcoming months we're looking at improving this so it's not as convoluted for some of our users as you've mentioned. We still don't have an idea of when this will be launched as we're still in the design phase of improving this feature, but it will be before the end of 2019 (most likely). In terms of the transaction movement from business to personal. We have had quite the thread on this previously, and I would be happy to speak more to it, but I do think it would be worth your while to check out this thread that has a number of reasons as to why we did this, and how the workflow changed: https://community.waveapps.com/discussion/comment/15682#Comment_15682

  • MCSMCS Member Posts: 3

    It should be that easy.....but you program does not work right...all the amounts are in there but it won’t reconcile. Makes no sense. I think if you gave a list of all the amounts you should be able to check them off with what on the statement.....do easy, but in your program if the dates are off it won’t work because they don’t show up in the statement you need to clear.
    Something so easy you made hard.

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